Missouri Court Holds That Economic Loss Doctrine Bars Plaintiff's Tort Claims


A Missouri district court recently ruled that a negligent misrepresentation claim was barred by the economic loss doctrine in a case involving a merchant-to-merchant sale of allegedly defective products.

The plaintiff, Bruce Martin Construction, Inc. (Martin), a dealer and installer of grain bin unloading systems sued the defendant CTB, Inc. (CTB), a farm equipment manager and marketer, for breach of express warranty and negligent misrepresentation. Martin alleged that it had to replace malfunctioning CTB systems at significant expense and that CTB’s systems have exposed Martin’s customers to risks of danger and increased labor costs due to the systems’ failure to perform as warranted.

CTB argued that the negligent misrepresentation claim should be dismissed under Missouri’s economic loss doctrine, which precludes tort claims arising solely from the sale of defective products where there is no personal injury or property damage. The court determined that application of the economic loss doctrine was appropriate in this case, rejecting Martin’s argument that its negligent misrepresentation claim should be allowed because it was covered by the public duty exception to the doctrine. The court was not convinced, however, and found that there was no allegation that the failure to disclose in this case violated any duty other than those arising out of the parties’ contract. In particular, the court held that the public duty exception was not applicable because the alleged harm to the public only came into play if the end users chose to disregard the machine’s operating instructions.

Bruce Martin Construction, Inc. v. CTB, Inc., 2012 WL 718624 (E.D. Mo. March 6, 2012).

Please see article below.

LOADING PDF: If there are any problems, click here to download the file.

Written by:

Published In:

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Katten Muchin Rosenman LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »

All the intelligence you need, in one easy email:

Great! Your first step to building an email digest of JD Supra authors and topics. Log in with LinkedIn so we can start sending your digest...

Sign up for your custom alerts now, using LinkedIn ›

* With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name.